Trustee wants New York lawyer jailed for failing to cooperate with company bankruptcy

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Signage is seen in the United States Bankruptcy Court for the Southern District of New York in Manhattan, New York, United States, August 24, 2020. REUTERS / Andrew Kelly

  • Kossoff’s trustee also asks judge to force Manhattan DA to hand over files
  • The trustee struggled for months to get the files from the law firm

(Reuters) – Chapter 7 administrator overseeing breakup of New York real estate law firm Kossoff PLLC demand a bankruptcy judge on Tuesday to hold its founder in civil contempt and order him to jail if he continues to defy court orders to cooperate.

The trustee, Al Togut, also asked the judge in a separate movement Tuesday to compel the Manhattan District Attorney’s Office to turn over certain grand jury documents relating to its investigation into company founder Mitchell Kossoff.

The records highlight Togut’s growing frustrations in handling the estate of the Kossoff company, which was forced into bankruptcy in May after creditors claimed it embezzled more than $ 8 million from its escrow accounts.

Kossoff’s refusal to comply with several court orders to produce records has “considerably increased the administrative expenses of this estate, which is detrimental to the interests of the victims of Kossoff’s fraudulent activity,” Togut wrote to the US bankruptcy judge. David Jones.

Togut declined to comment on Tuesday.

Mitchell Kossoff, once a fixture in New York’s legal real estate market, has argued that he will give up his right against self-incrimination if he turns over firm cases to Togut, adding that he will cooperate if he does. he enjoyed immunity from prosecution. Jones rejected that position in July, and a federal judge in Manhattan dismissed Kossoff’s appeal on the case on September 30.

Togut said Jones can “enforce the terms of a civil contempt order by ordering the incarceration of the party who does not comply with a legal order.” Financial sanctions won’t work, given Kossoff’s apparent inability to afford Louisiana bankruptcy attorney, Togut added.

Walter Mack, a criminal defense attorney for Kossoff, did not respond to a request for comment.

Mack said Kossoff was under investigation by the Manhattan district attorney. The district attorney has records that are “essential” to Togut’s administration of the Kossoff company estate, but he “turned a deaf ear,” Togut wrote.

“The trustee only asks for copies of the debtor’s internal business documents. The trustee’s request is not about obtaining explosive testimony,” Togut added.

A spokesperson for the Manhattan district attorney declined to comment.

The case is In re Kossoff PLLC, U.S. Bankruptcy Court for the Southern District of New York, No. 21-10699.

For Togut: Neil Berger, Brian Shaughnessy and Minta Nester of Togut, Segal & Segal

For Kossoff: Walter Mack de Doar Rieck Kaley & Mack

Read more:

Document struggle complicates Kossoff law firm bankruptcy

Besieged real estate lawyer Kossoff can’t protect bankrupt doctors

 

David Thomas reports on legal affairs including law firm strategy, hiring, mergers and litigation. He is based in Chicago. He can be reached at [email protected] and on Twitter @ DaveThomas5150.

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